Clouds of dust mix with white smoke as the tanks search for targets. Mortars land around them, setting fire to the grass, but the tank crews are more fearful of the anti-tank weapons they know Hizbullah fighters possess nearby.

A short distance away, below a United Nations observation post, another tank is positioned in a quarry.

For days it has been driving up and down, firing its machine gun and belching out smoke for cover as if in fear of imminent attack.

This scene is being played out metres away from the Israeli border fence that guards the town of Metulla, the largest town on the Lebanese border.

After 33 days of fighting, thousands of bombardments and the deployment of 30,000 troops in Lebanon, the battle is still raging on Metulla's doorstep. Through binoculars the yellow Hizbullah flag could still be seen flying in the village of Kila, less than half a mile away.

Hizbullah fighters remain within a mile of the Israeli town, firing mortars and rockets and resisting the full might of the strongest army in the Middle East.

Metulla now seems a more precarious place than at the beginning of the conflict. For the first time in a week, two rockets hit the town centre and several landed on the hillsides around it. One was even fired from a nearby ridge towards the town of Kiryat Shemona.

The situation in Metulla is indicative of Israel's problems in combating Hizbullah. Its declared war aims, in addition to freeing two captured soldiers, were to neutralise the Shia militia, push it back from the border and stop the firing of rockets. In spite of the exercise of all Israel's military might, these aims have not yet been realised.

In other areas, Israeli forces have pushed deeper into southern Lebanon.

On Saturday, about 50 helicopters were used to airlift hundreds of troops close to the Litani river. Some analysts believe that Israel intends to deal with Hizbullah fighters closer to the border when these troops withdraw according to the UN ceasefire resolution. "I think this talk of a ceasefire going into effect tomorrow seems to be highly exaggerated and dubious," Mouin Rabbani, a senior Middle East analyst for the International Crisis Group, told Reuters yesterday. "It seems that Israel's strategy has been to establish positions as far north as possible to implement a fighting withdrawal, meaning that they will try to take on as much of Hizbullah as they can as they work their way south."

Metulla, which has a population of 2,000, has been at the heart of the action for the past month. Thousands of Hizbullah Katyushas have passed over it with a shuddering bang on their way to targets in northern Israel.

Israel replied by firing its rockets and artillery, deafening the residents of Metulla. The town is on a plateau surrounded by a ring of Lebanese hills. In the west is Kila then travelling clockwise, there is Qleia, Marjayoun and Khiyam.

Metulla is also at the head of the Hula Valley which contains Kiryat Shemona and descends towards the Sea of Galilee and the Jordan valley.

Because of the topography of the valley, it is possible to see a large part of the fighting from the centre of Metulla, the attacks on Israel to the south and on Lebanon to the north.

Much of the fighting has followed a predictable course. Israeli shells and airstrikes bomb villages day and night. The same hilltops, hollows and buildings have been bombed every day for a week, without troops moving towards them.

The soldiers say that "nests" of Hizbullah fighters remain all around the valley.

According to one soldier, Israeli forces bypassed them: "Hizbullah have logistics bases in the villages where they have arms, food and intelligence posts. Then they have networks of tunnels and bunkers outside the villages.

"We aimed to cut them off from their logistics by sending troops to the villages."

He admitted that this was the theoretical approach and it was not clear if it had succeeded. "The troops move on because this is not about holding territory and Hizbullah come back," he said.

The village of Kila is overlooked by an Israeli observation post and was supposed to be held by Israeli troops. In recent days, there have been nightly battles and yesterday Israeli artillery began shelling it.

It is also not clear that Israeli forces have made it to Khiyam, a reputed Hizbullah stronghold which continues to be bombed relentlessly. At night, tanks emerge from Metulla and fire shells at Khiyam. One target seems to be a cluster of farms on the floor of the valley, which is shelled every day but never approached, as if it is the base of a formidable force.

There are soldiers milling around Metulla. Some have fought and others are about to fight. One said: "Even with a hundred tanks, it is very difficult to find small groups of guys running all over the hillside."

Another said that it was completely illogical for the Israeli army to use tanks against an enemy whose principal weapon was the anti-tank missile. More than half of Israel's military casualties have been caused by anti-tank weapons.

Within an hour of news emerging of the Israeli cabinet approving the UN security council resolution to end the war, residents and guests are ordered into the bomb shelters.